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Dana Reports Second Quarter Sales of $2.59B

The company generates strong free cash flow and maintains sales guidance.

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Dana has announced financial results for the second quarter of 2022.

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“While strong demand, the launching of our new business backlog, and the recovery of commodity costs continued to fuel sales growth for Dana in the second quarter, margins were impacted as a result of record inflation and rising material costs, ongoing supply-chain disruptions, and volatile customer demand schedules that are affecting the entire mobility industry,” said James Kamsickas, Dana chairman and CEO.

“Despite these challenges, Dana generated significant cash flow in the second quarter as we continued our successful transformation into a leading e-Propulsion supplier. We are focused on launching our new products for both traditional and EV programs, and we are well-positioned to capitalize on the strengthening of our businesses when the global environment begins to stabilize.”

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Second-quarter 2022 Financial Results

Sales for the second quarter of 2022 totaled $2.59 billion, compared with $2.21 billion in the same period of 2021, a $381 million improvement driven by strong customer demand across all of our end markets and the recovery of commodity costs, partially offset by foreign currency translation.

Adjusted EBITDA for the second quarter of 2022 was $162 million, compared with $233 million for the same period in 2021.  Profit conversion on higher sales in the second quarter of 2022 continued to be tempered by higher raw material costs and non-material inflation, as well as production inefficiencies driven by supply-chain constraints and volatile customer demand schedules across the mobility industry.

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Adjusted net income attributable to Dana was $12 million and diluted adjusted earnings per share were $0.08 for the second quarter of 2022, compared with an adjusted net income of $86 million and $0.59 per share in 2021.

Operating cash flow in the second quarter of 2022 was $257 million, compared with $67 million in the same period of 2021. 

Free cash flow was $167 million, compared with a use of $13 million in the second quarter of 2021. The improvement was driven by lower working capital requirements largely attributable to focused management of inventories and receivables.

“Our adjusted profit targets reflect the difficult environment that continues to impact the entire mobility industry as a result of global supply-chain disruptions and record cost inflation,” said Timothy Kraus, Dana senior vice president and chief financial officer.  

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“We continue to aggressively work to mitigate the impact of these challenges. As they begin to subside, we anticipate a sustained recovery period as a more stable production and supply environment, combined with strong end-consumer demand and low-vehicle inventories should drive profitable growth.”

2022 Financial Targets

  • Sales of $10 to $10.2 billion;
  • Adjusted EBITDA of $700 to $740 million, an implied adjusted EBITDA margin of approximately 7.1 percent at the midpoint of the range;
  • Diluted adjusted EPS of $0.60 to $0.90;
  • Operating cash flow of approximately 6.2 to 6.5 percent of sales; and
  • Free cash flow of approximately 1.8 to 2.2 percent of sales.

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